This page covers the ways to invest in Canadian real estate without owning a property yourself: REITs and REIT ETFs on the stock exchange, and private options such as crowdfunding platforms, mortgage investment corporations and limited partnerships. It compares their minimums, liquidity, risks and tax treatment. It is part of WealthNorth’s guide to real estate investing in Canada.
The options at a glance
| Option | How you earn | Liquidity | Minimum | Main risks |
|---|---|---|---|---|
| REIT ETFs | Distributions and unit price from a basket of REITs | Sell any trading day | One unit | Stock market and interest rate swings |
| Individual REITs | Distributions and unit price from one landlord’s portfolio | Sell any trading day | One unit | Concentration in one company and sector |
| Real estate crowdfunding | Interest on development loans or a share of a project’s profit | Locked in until the project ends | Set by the platform | Project delays or losses; platform failure |
| Mortgage investment corporations (MICs) | Interest from pooled mortgages | Limited; redemptions can be restricted | Often in the thousands | Borrower defaults; limited transparency |
| Real estate limited partnerships | Share of rent and sale proceeds from specific buildings | Locked in for years | Often high; some are for accredited investors only | Illiquidity; fees; manager risk |
| Owning a rental (for comparison) | Rent, principal paydown, appreciation | Months to sell | A down payment of at least 20% | Vacancy, repairs, leverage |
REITs and REIT ETFs
A real estate investment trust owns and operates income-producing property (apartments, industrial buildings, shopping centres, offices, seniors’ housing) and pays most of its income out as distributions. How REITs work, the property sectors and how to judge one are covered in REITs in Canada.
A REIT ETF holds many REITs in one fund, which removes the risk of picking a single landlord. The main Canadian REIT ETFs, with their fees, holdings and yields, are compared in REIT ETFs in Canada. For individual REIT picks by sector, see the best Canadian REITs in the stocks hub.
Real estate crowdfunding
Crowdfunding platforms pool money from many investors to fund a specific project, usually as a loan to a developer (you earn interest) or as equity in a building (you share in rent and sale proceeds). Things to check before investing:
- Registration. Platforms that sell securities to the public must be registered with, or operate under an exemption from, your provincial securities regulator. The Canadian Securities Administrators’ National Registration Search shows who is registered.
- Eligibility and limits. Some offerings are open only to accredited investors, and provinces cap how much a non-accredited investor can put into certain exempt offerings each year.
- Lock-up. Money is usually committed until the project is finished and sold or refinanced, and delays are common.
- Target returns are not guarantees. A project’s projected return depends on construction costs, sale prices and rates.
Mortgage investment corporations
A MIC lends pooled money as mortgages, often shorter-term, second-position or construction loans that banks decline, and generally pays its income out to shareholders as dividends, which it can deduct so the income is taxed in the shareholders’ hands rather than the MIC’s. Returns come from interest, so they track lending rates and default losses rather than property values. Many are private, and their redemptions may be limited to certain dates or suspended in a downturn. How MICs fit into the mortgage market is covered in mortgage investment corporations.
Real estate limited partnerships
A limited partnership buys specific buildings, often apartment buildings, and passes rental income and eventually sale proceeds to its limited partners. Partners have limited liability but little control, fees can be significant, and money is usually locked in until the properties are sold. Many are sold under prospectus exemptions to accredited investors.
Tax treatment
REIT distributions are made up of several parts, which can include other income, capital gains, return of capital and sometimes dividends, each taxed differently in a non-registered account; the T3 slip reports the split, and REITs in Canada explains each part. Dividends from a MIC (other than capital gains dividends) are taxed as interest income. Holding these investments in a TFSA or RRSP removes the annual tax on distributions, subject to the account’s qualified-investment rules, which many private offerings don’t meet.
REITs or a rental property?
Listed real estate trades leverage and control for liquidity, diversification and no landlord work. The side-by-side comparison of returns, costs and taxes is in REIT vs rental property, and the wider comparison with stocks is in real estate vs the stock market.
Sources
The figures and rules on this page come from these sources, last checked against them on September 25, 2026. How we check facts.
- Financial Consumer Agency of Canada: How much you need for a down payment